Note: Assumes the student borrows the average amount each year and graduates in four years. Graphic from Center for College Affordability and Productivity.

In 1999, the cost of tuition and fees at the University of North Carolina at Chapel Hill was less than that of a laptop: $2,350. That year, Shirley Ort, UNC’s associate provost and director of scholarships and student aid had to decide if adding an additional $2,350 to cover the cost of a computer was too extreme. But today, a yearly increase of this amount is the norm. And the increase gets bigger every year.

Tuition and fees have increased 5.6 percent in American public schools since 2001 according to the College Board, and the U.S. Census Bureau found only 25.6 percent of North Carolina adults have an undergraduate degree. With the rising cost of college, the percentage is expected to decrease.

“This is a really unsettled time for higher education,” Ort said. “I don’t think we know yet how to imagine our future in a way that can be reconciled both with public expectation and with political judgment. We know it can’t be the way it’s always been, but I don’t think we know yet quite how to shape a new vision for ourselves.”

College graduates are 50 percent less likely to be unemployed and earn nearly 85 percent higher salaries, according to the U.S. Labor Department. But as the link between higher education and financial stability becomes clearer, it is challenged by a failing system. The cost of college in the Tar Heel State has never been higher, while college degrees have never been in higher demand.

The changing landscape in higher education cost leaves thousands of students in the dark. With the future of student aid still in a fog, many don’t know what to expect from their college education — or to expect one at all.

Creating a national crisis

In the past 30 years, the cost of attaining a college degree has increased more than 1,000 percent. According to the Center for American Progress, the steady climb of tuition and fees is the result of many factors, but is primarily caused by the 2008 recession and a decrease in government funding.

The recent recession in the United States affected college affordability by devastating other markets. As unemployment rose and the housing market deteriorated, funds that would have been allocated for college tuition evaporated.

Competition among universities motivates an increase in tuition. According to David Gelinas, director of financial aid at Davidson College, students expect the cost of college will provide a certain level of amenities on campus. Photo by Claire Esparros, photo editor.

“There is a significant number of folks who planned to fund their sons’ and daughters’ higher education expenses from either their current income or their home,” said Gerald Whittington, vice president for business, finance and technology at Elon University. “The home values have plummeted, so that’s a real pressure. Avenues that people might have had are gone, and that’s really difficult. Few of us ever did what we should have done, which is putting money away the day our sons and daughters were born.”

The struggling economic climate has no doubt challenged the federal government as well. In order to try and balance the budget, the federal government has cut education spending, including funding for the Pell Grant.

Pell Grants, provided by the U.S. Department of Education, make up the foundation of financial packages for students who qualify based on need. Additional scholarships and aid are often added to this amount, but are rarely enough to send a student to school who otherwise could not afford it.

“The budget that the House has passed actually cut Pell Grants, the same Pell Grants that 9 million students currently depend upon to go to college,” said N.C. Sen. Kay Hagan during a college affordability conference call in October. “The House cut means 1 million students would lose their Pell Grant coverage over the next two years, and I think that’s not a good way forward.”

But the North Carolina public university system cannot cover the gap the absence of Pell Grants will create. It already spends 12 percent of its budget on public universities, accounting for 2 billion dollars a year.

Prior to 2012, the state offered the North Carolina Legislative Tuition Grant, a non-need based $1,850 grant to every resident. As of the fall 2012, that funding has been removed for students who do not meet the requirements based on the Free Application for Federal Student Aid, a form that determines a student’s eligibility for Pell Grants, federal student loans and federal work-study.

“These are tough economic times, but you’re seeing that amount of state aid go down,” Hagan said. “The burden then becomes much higher on the students because the universities have to end up increasing tuition.”

Others said they see the rising tuition result from greater competition between schools and a need to keep up with current trends in resources.

“The most obvious driver that I have seen is the need to keep up with constantly changing technology, and an expectation on the part of our students that there will be a certain level of amenities on campus,” said David Gelinas, director of financial aid at Davidson College.

If a university chooses to ignore those trends in order to keep costs down, they usually end up falling behind. Attracting students is a top priority for universities, and without certain perks, applicant pools shrink. As long as tuition increases for all of a university’s competitors, remaining in a pack of expensive schools doesn’t do much harm to admission statistics.

“You’re probably here because you probably want the experience that this institution provides distinctly from another institution, and you can’t get away from the fact that it costs what it costs,” Whittington said.

As the burden increases, students resort to federal and private loans. Both public and private schools have seen a dramatic increase in the number of students who rely on loans to fund their education.

“The amount of loans that our students have here at Elon is higher than it’s been, and the pressure to pay it back is a real issue nationally,” Whittington said.

But how much responsibility should students accept? If college affordability is an issue for students, should they bend to their financial limitations and not enroll in a school that will put them in debt?

“Sometimes the people who have significant amounts of debt made a choice that they later have buyer’s remorse about,” Gelinas said. “They may look at it like the system is broken, and I think there are some cases where you can say yes, but you made a decision that led to where you are today, so why blame the system for a personal decision? Now that’s a hard conversation, but it’s one that’s legitimate.”

“The House cut means 1 million students would lose their Pell Grant coverage over the next two years, and I think that’s not a good way forward.” -N.C. Sen. Kay Hagan

Some students have their hearts set on particular institutions and will accept any amount of debt to get the education they desire. According to Ort, this is not an uncommon attitude.

“Brand loyalty is a curious thing,” she said. “You can get a very good education at most schools. It has so much to do with embracing an opportunity. When young people don’t get into Carolina and they tell us their life is going to be ruined because they didn’t get in, usually, what we see is a year later somebody is so happy where they ended up, and they say ‘I can’t imagine what it would have been like if I hadn’t done this.’”

Universities are accountable as well. Part of a student’s application for a private loan must be completed by the university, which some said they believe should be taking student debt seriously.

“We do have some involvement there,” Gelinas said. “But at the end of the day, the individual borrower has to say, ‘I will go through with this, or not. We definitely try to council all of our potential borrowers, especially those who want to go to the private sector, because those are in the realm of more than the federal loan limit. We feel like we should at least discuss with them the implications of doing that.”

Debt consequences destroy dreams

As the cost of education becomes less manageable, North Carolina students bear the burden of the funding fatigue, rather than universities.

“Private universities are doing pretty well right now, and they’re strengthening their financial position,” Ort said. “They’re recruiting a lot of really stellar, quality faculty away from public research universities because we just can’t compete. When they raise tuition they can use it for enrichment and strengthening an academic program. When we raise tuition, we’re usually filling a hole.”

It’s a challenge for public universities to meet even their own instructional objectives during these financial times, according to Ort. This means less effective education.

After graduation, the consequences worsen. Payments are typically due within 6 months of graduation. Those who can’t make payments slip deeper into debt, just as they do with credit loans and mortgages — there is no exception made for those who signed their financial futures away before they were legal adults.

“Getting a college education shouldn’t be a burden to our young people by leaving them with an unsustainable debt load,” Hagan said. “Today our Americans have more student loan debt than credit card debt.”

Students who accumulate attend both public and private schools bear the debt burden. For many, staying in-state could provide financial freedom, but at a cost.

Taylor Davis, an Elon University junior, had similar experiences with public and private colleges. Davis attended UNC-Greensboro as a freshman, but transferred to have more opportunities, better facilities and smaller classes.

“I feel like I’m getting a better education for sure, and I like the atmosphere,” she said. “My smallest class at UNCG was 100 students, and my smallest class here is 15. I had professors that wore microphones on their shirts. That’s just not how I learn.”

Trying to move forward during the debt crisis

The issue of college affordability is not lost on politicians, advocates or universities across the country. Student debt and its consequences have become part of national legislative dialogues.

“Many colleges want to control cost, but there’s a lot that federal and state policy makers can do to make sure that those who have the least can actually get access to the education that will allow them to join the economy and make a better life for themselves and their country,” said Jose Cruz, vice president for higher education policy and practice at The Education Trust during a conference call.

“In the national discussion, I think the country as a whole is going to have to come to the point of saying ‘Is higher education valuable? Is this something that we need to, as a society, continue to support?’—not just with our lips, but with our pocketbooks as well,” he said. “Are we over the long term cutting off our nose to spite our face by not supporting it?”

According to Hagan, North Carolina is on the right track.

“In North Carolina, our business community gets it,” she said. “They understand why students need to afford to invest in their education, because these are the workers that our businesses need and entrepreneurs need to grow and foster.”

But for a state that understands the importance of affording an education, there is an absence of preparation for students.

“My high school didn’t really help that much,” Davis said. “I was prepared for college, but no one told me what to expect. No one told me how much money it would be.”

Gelinas said educating students on the cost of college is a priority at Davidson.

“We have a loan counselor who sits down to discuss why students choose to go that route,” he said. “We show them, we try to be really personal with the process.”

Many said this conversation must become a priority for high schools during the college application process, to prevent students from making unsound financial decisions.

North Carolina’s debt reality

Today, the price of a quality laptop is less than it was in 1999, but the same cannot be said for college tuition for North Carolina institutions. One year at UNC costs in-state students $22,340, and while Ort said the university is committed to access and affordability, many students still remain outside of classrooms.

But Ort can only do so much. Without a value on education and funding from the federal government, there are limits on the aid the state of North Carolina can provide.

“When public universities raise tuitions, they’re usually trying to get back a piece that the state legislature took away,” she said. “That’s something that gets lost on a lot of the American public.”

Instead of going on really fancy vacations, owning boats, owning beach houses and living in a bigger house, etc. my parents saved up money for my education and lived within their means, which I’m very grateful for. I’ll probably do more or less the same for my children. As a result, I won’t have much debt upon graduating. I think in some situations, the debt concern is definitely a problem, but in other cases… it just comes down to being financially responsible. Live in a huge house with a heated swimming pool today…. lots of student loans tomorrow.